Finding the litigation frivolous and raising questions over the jurisdiction of the lower court in the case, the Calcutta High Court asked the petitioner to pay a cost of Rs50,000 for a frivolous case

Clearing the decks for merger of Bank of Rajasthan (BoR) with ICICI Bank, the Calcutta High Court (HC) today quashed a civil court injection against the deal and asked the petitioner to pay a cost of Rs50,000 for a frivolous case, reports PTI.

A civil court in Kolkata on 21st June had restrained BoR from holding a shareholders' meet the same day, where an approval was being sought for merger with ICICI Bank.

Although, the BoR management called off the extraordinary general meeting (EGM), the shareholders went ahead and voted in favour of the merger and the issue is now pending approval of the Reserve Bank of India (RBI).

The same day, ICICI Bank appealed to the Calcutta High Court, which in turn stayed the civil court injunction and posted the matter for hearing later.

Taking up the matter, the high court today quashed the civil court injunction and also raised questions over jurisdiction of the lower court in the case.

Finding the litigation as frivolous too, the high court asked the petitioner, an investor who claims to represent the shareholders of BoR, to pay the cost of Rs50,000 for acting in a frivolous way.

Earlier, the locus standi of ICICI Bank was also questioned on whether it was right in appealing against an injunction against the shareholders' meet of BoR.

However, the high court upheld ICICI Bank's right to appeal as BoR was in the process of merging with it and pending all approvals, the Udaipur-based bank was held by a trust.

Hearing the matter, the high court also examined the jurisdiction of the civil court, both in terms of territorial issues and dealing with a company matter.

Observing that the matter should not have been entertained in a civil court and it related to an entity outside Kolkata, the high court quashed the injunction.

Earlier on June 21, when BoR's shareholder meet was underway in Mumbai, its managing director received a letter from an advocate in Kolkata, informing him about the civil court injunction.

Subsequently, the MD decided to adjourn the meet and left the venue, but shareholders decided to go ahead with the meeting. They even passed the resolution towards the merger of BoR with ICICI Bank, the country's top private sector bank, and later the resolution was sent to authorities concerned.

ICICI Bank in May agreed to take over BoR in a share-swap deal that valued the Udaipur-based bank at over Rs3,000 crore.

The share swap ratio was fixed at one ICICI Bank share for every 4.72 shares of BoR. The deal is now pending for approval from RBI.

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Last year, India had the highest increase in production of natural gas worldwide as well as the highest corresponding increase in consumption in natural gas worldwide, BP Plc Group chief economist Christof Ruhl noted

India recorded the highest rise in natural gas output worldwide in 2009 after Reliance Industries' (RIL) eastern offshore KG-D6 field came into production, reports PTI.

Billionaire Mukesh Ambani-run RIL began gas production from the Krishna-Godavari (KG) basin in April, 2009, and its 60 million standard cubic metres per day (mmscmd) output led to a 75% jump in natural gas availability in the country to 140 mmscmd.

"Last year, India had the highest increase in production of natural gas worldwide. And I just checked, it also had the highest corresponding increase in consumption in natural gas worldwide," BP Plc Group chief economist Christof Ruhl said.

The jump in natural gas production in India was possible because the government allowed private sector firms to take a lead in exploration for hydrocarbons.

"When you look at countries where gas production is heavily government-controlled, like Russia, they had the biggest decline in gas production and consumption," he said.

"When you look at countries where new technologies have been developed like unconventional shale gas in the US... it was because they have an investment environment which is very competitive," he said.

Shale gas, trapped in sedimentary rocks, is said to hold the potential of doubling gas output in US.

Mr Ruhl said that it was very clear who was left behind, as countries where natural resources were tightly controlled were less flexible.

He said the recent Supreme Court ruling in the Ambani gas dispute will help investment in the sector.

For investors, "rule of law" and "sanctity of contracts" they sign is important, he said.

The court in May upheld the provisions of the Production Sharing Contract (PSC) an explorer enters into with the government for oil and gas prospecting. It said the PSC gives the government the right to approve a gas price and fix its users, rejecting Anil Ambani Group firm Reliance Natural Resources Ltd's (RNRL) claim for gas from RIL at subsidised rates.

"That (judgment) has certainly improved stability and the sanctity of contract," he said. "That was a step into the right direction.

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Shadi Katyal

6 years ago

Are these the same fields which the PSU could not find any or was it that they sold out to private Reliance.

Since India has such a large production and consumption why cant we get some figures and where it is being utilised???

"India is facing its worst inflation problem in a decade, and since the central bank can do little in the short run, the government must play a greater role in addressing it, Moody's Analytics said

The government needs to play greater role in taming inflation by reigning in spending, as the Reserve Bank of India's (RBI) tightening of its policy rates will have little impact on checking price rise, global research firm Moody's said today, reports PTI.

"India is facing its worst inflation problem in a decade, and since the central bank can do little in the short run, the government must play a greater role in addressing it, Moody's Analytics said.

"The problem cannot be tamed by simply raising interest rates to slow monetary growth," it added.

Moody's said growth of bank credit and money supply were sluggish in May at 18.8% and 15.1%, year-on-year, but surging prices of food and imports saw consumer inflation reach 13.9% during the month.

It said although the government has taken steps to divest stake in public sector undertakings (PSUs) and cut oil subsidies, it needs to reign in spending and borrowing because the combined central and state deficit is close to 10% of the gross domestic product (GDP), total economic output.

The research firm added that fiscal austerity would slow prices and boost the economy's longer-term prospects.

"With economic growth on a solid footing, inflation spiking, and liquidity in the banking system short, there is little excuse for not taking aggressive action to quickly reduce the budget deficit," Moody's said.

It said that with key state elections coming up there was a major question over whether the government would have the political will to step up austerity measures.

Moody's added, however, that with business confidence revived and firms looking to expand, it should set aside concerns about upsetting coalition members and tighten its fiscal affairs.